Efficiency and Productivity Analysis of Cooperative Dairy Plants in Haryana and Punjab States of India

Since the 1970s, the policy of Indian government has been to promote dairy development on the basis of the cooperative organisations. During the 1990s the dairy industry in India was liberalised. This study examines the impact of the liberalisation policy on the cooperative dairy plants in India. Data envelopment analysis (DEA) and the Fisher index approach are applied to measure economic efficiency and total productivity changes, respectively. The data involves 65 observations from a complete panel of 13 cooperative dairy plants from 1992/93 to 1996/97. The empirical results show that the deregulation and liberalisation of the dairy industry alone is not the answer.